HABITAT: The Plunge

Buy a house? Here's why you should stop worrying and become your own landlord.

Tags:

If you're thinking about buying a house for the first time, chances are you're running scared.

A thousand worries keep you awake at night—from fear of lead poisoning to dark brooding about the evil financial industry to the dread of turning into your parents. We can't fix your unresolved emotional conflicts—we're not psychoanalysts, for God's sake!—or disabuse you of conspiracy theories and hypochondria. But we can tackle some philosophical objections and looming anxieties that keep many potential home buyers sitting on the fence (and, more to the point, shoveling hard-earned cash into their landlords' pockets).

What if the market crashes? If you stayed awake through Econ 101, you may be haunted by a dim recollection that every boom is followed by a bust. Housing prices in Portland have been zooming into the stratosphere during the last few years—what if it all collapses tomorrow? You may have also followed recent headlines predicting imminent catastrophe in something called the "subprime mortgage market." Before you start to obsess over the Crash of '29, however, consider this: Over the long haul, home prices have historically always climbed. Median home values in Oregon have risen 623 percent since 1940, according to the U.S. Census Bureau, and that's excluding inflation. True, sometimes prices in individual submarkets retreat after a surge. On Portland's west side, for example, prices dropped 1.3 percent in 2001 but rose 9 percent the next year. Similarly, prices in Tigard dipped 12 percent in 1995 but soared 27 percent the next year. And the general, overwhelming trend is always up. "It's an escalator," says Portland real-estate agent Kama Dersham (who helped me buy my house). "And it's going up whether you get on or not."

I've missed the boat. Welcome to the club. People always feel like they missed the boat. Yes, prices today are higher than ever. The cool, up-and-coming neighborhood you'd love to live in is less affordable than it used to be. But the same thing was true last year, and the year before, and the year before that. Pick any year in the last century—housing prices stood at historic highs. Your grandparents probably felt gouged when they shelled out $2,938, the going rate for a house in 1940. Fretting about the gentrification of Neighborhood X in Portland began just after the Earth's crust formed. Sure, it would have been smarter to buy last year, but you didn't. Shed no tears for the overturned dairy products—take action.

I'm too flaky to pay a mortgage. Unless you live in a tent or under a bridge, you are almost certainly paying a mortgage already. It just happens to be your landlord's mortgage. Of course, we do not recommend getting into a monthly payment that you can't possibly make or signing on to an adjustable interest rate that could shoot up beyond your means.

I don't want to be a bourgeois sellout. Listen, brothers and sisters: There is nothing to prevent you from festooning your new pad with giant posters of Chairman Mao, hosting revolutionary councils in the basement (with canapÉs!) or flying the Cuban flag from the porch—and you won't have an uptight landlord lecturing you about the virtues of the free market.

If you reject the concept of private property, abhor debt or believe that termites have a right to eat whatever they choose, then no, you probably shouldn't buy a house. But consider the value of autonomy. Band practice at 3 am? Rebar statuary in the yard? That clothing-optional backyard tiki pavilion you've always wanted? You're the one who must make peace with the neighbors, but other than that, you're the boss.

I don't have the money. Many people labor under the impression they need tons of green before they can jump into the housing game. In fact, the requirements for a down payment are usually pretty relaxed. In most cases, $3,000 is enough. Banks are typically more impressed by a steady income than by massive piles of cash—they've got plenty of that themselves.

What about peak oil? Global warming? Nuclear holocaust? Shouldn't I save my cash for potato seedlings and AK-47s? The Space Vikings from Zargon won't be overly concerned about your financial condition, and Jared Diamond-style societal collapse will be harsh whether you own or rent.

My credit stinks. My taxes are screwy. I don't know what "escrow" is. Deep down, I'm a bad person and I don't deserve a loan. These objections rest on a fundamental misunderstanding of the housing industry. In case it hasn't occurred to you before, bankers get rich by making loans. Real-estate agents make money by selling houses. Many people want you to borrow money and buy the bungalow of your dreams. There is an army of specialists whose jobs revolve around helping you hurdle these obstacles so you can qualify for a loan, find a house and buy the sucker.

So there. And there's one other thing that no one can ever quite explain about owning your own hunk of planet, but I'll try anyway: It feels pretty damn good.